The Beginning

“If I were again beginning my studies, I would follow the advice of Plato and start with mathematics.” So said Galileo Galilei. Plato himself thought the beginning the most important part of the work. Thus the question, how is the beginning of the new government in Poland following the Law and Justice (PiS) party’s victory in the election held on 25th October?

Well, as I wrote in last week’s piece (please see Victory) and said on Radio Poland (link here) gloom and doom seems unlikely. And, like Plato, they are beginning, if not exactly with mathematics, then certainly with a number. And that number is 500. PLN 500, to be precise, the allowance per child promised by PiS which will not after all, begin by January as announced, although “this first campaign promise is a priority,” according to Henryk Kowalczyk, a PiS MP who is expected to take over as Poland’s Finance Minister.

This measure is estimated to cost some PLN 22 billion annually. While it may be technically difficult to begin in January, even if a draft law becomes effective then, the first payments are expected in April to cover the first three months of the year. Families with only one child will not eligible for the allowance, unless the income of the family is PLN 800 per person, or less, per month. Families with two or more children will receive PLN 500 (EUR 118) per child. Not a huge sum, but Poland needs children and, in the words of a well-known supermarket, itself struggling with numbers, every little helps.

Which brings me to the next number, two. This is the percentage levy on turnover which the new government proposes to impose on supermarkets that have a sales area greater than 250 square metres, and which is expected to raise some PLN 3.5 billion (EUR 0.8 billion) annually. According to PiS, in 2013 some 175 retail chains paid approximately PLN 440 million in corporate income tax in total, equal to some 0.47 per cent of their annual revenue.

The idea is to curb the transfer of profits abroad (but this measure does not address profits), to limit the expansion of foreign-owned retail chains, and to level the playing field for smaller shops. Henryk Kowalczyk would like to see the law come into force as soon as possible, but it is not clear whether this will be on 1st January 2016 or later on in the first quarter. Such a levy would be new for Poland, but it does follow the example of Hungary which introduced a special tax rate of 0.1 to 2.5 percent for the largest retailers. Ryszard Petru, head of the Nowoczesna (Modern) party, has said that the levy would predominantly affect consumers, as it will translate to higher prices.

Which brings me to the final number of the day, one. That is number of candidates for prime minister missing from her party’s first set of talks about the future cabinet. Szydło’s absence lead to media speculation that party leader Jarosław Kaczyński was intending to take all the decisions. After all, who in Poland doesn’t love a good conspiracy theory? However, the chairman of PiS’s parliamentary club Mariusz Błaszczak, who did take part in the talks, claimed that her Szydło’s absence was because she needed “a rest” after the election campaign. I hope she’s in better shape than the infamous Norwegian Blue parrot with lovely plumage.

“Beata Szydło’s role in the formation of the government is key,” Błaszczak insisted in a television interview with TVN24. Yes, a prime minister’s role typically is, although some countries do play by different rules. Szydło emerged as PiS’s candidate for prime minister after she had led the successful campaign for the election of Andrzej Duda as president in May’s presidential elections. Before she emerged, it was often suggested that Kaczyński, aged 66, was too old to appeal to younger Polish voters. Be that as it may, PiS won 37.58 per cent of the vote, the first time since the fall of communism in 1989 that one party has had a large enough majority to govern without a junior coalition partner.

So there you have it, so far nothing to frighten the horses and we can perhaps take heart from Seneca that “every new beginning comes from some other beginning’s end,” although this beginning has not quite ended.

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